#EUPrivacyCoinBan European Union's Anti-Money Laundering Regulation (AMLR) introduces significant changes to cryptocurrency regulations, particularly concerning privacy-focused coins and anonymous accounts. Here's an overview of the key developments:
Ban on Privacy Coins
The AMLR includes a provision to ban "privacy-preserving coins" such as Monero (XMR) and Zcash (ZEC) by 2027. This move aims to enhance transparency and combat illicit activities facilitated by anonymous transactions. Notably, exchanges like Binance and Kraken have already delisted Monero in certain European countries in anticipation of these regulations.
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👤 Restrictions on Anonymous Accounts
Under the AMLR, Crypto-Asset Service Providers (CASPs) are prohibited from offering anonymous accounts. This measure aligns with existing anti-money laundering (AML) practices and reinforces the requirement for customer due diligence.
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🔐 Self-Custody Wallets Remain Permissible
Contrary to some reports, the AMLR does not ban self-custodial wallets or peer-to-peer (P2P) transactions. Individuals can continue to use non-custodial wallets, where they control their private keys, without additional regulatory constraints.
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💶 Transaction Thresholds and Due Diligence
While initial proposals suggested a €1,000 limit on transactions from self-hosted wallets, this restriction was removed from the final AMLR text. However, CASPs are required to perform identity verification for transactions equal to or exceeding €1,000.
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🕵️♂️ Enhanced Monitoring of Transfers
Transfers between CASPs and self-custody wallets will be subject to "risk-mitigating" measures, such as blockchain analytics or additional data collection, to align with the Financial Action Task Force (FATF) travel rule.
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📅 Implementation Timeline
The AMLR is expected to be fully operational by 2027, following final approvals from the EU Council and the European Parliament. This timeline provides a transition period for stakeholders to adapt to the new regulatory environment.
